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Should We Remodel?

Whether it’s a homeowner who is looking to update their home and hopefully bring in a higher price, or homeowners who intend on staying in their home for the long haul – it ultimately comes down to what affect the remodel will have on the market value of the home. 

Home staging is a frontline topic these days – it’s something every real estate professional should understand, and something every homeowner should incorporate into the sales process.  But sometimes staging that home is just not going to be enough.  There are a lot of people remodeling at any given time for any number of reasons – it’s an over $240 billion dollar industry.  So how do you respond to your sellers when they ask for your opinion – “Should we remodel or not, and if so, what should we do?” 

The first thing to realize is that question is loaded one and should be answered very carefully; it actually rings with potential liability.  On the other hand, as a professional in the real estate market you should be prepared to discuss the process, options and benefits of remodeling in addition to staging.  And once again, it falls back on what the market will bear.  And who should be better prepared to answer that question than you? After all, it’s your marketplace.

So how do you answer the question without making those firm recommendations that are full of potential liability? Here are some thoughts to consider:

  • Richard Powers, MAI and SRA, of the Appraisal Institute offered this advice,

“… avoid over-improvement by sticking to what’s standard in your neighborhood.”

  • Before assuming that remodeling is the only choice, consider: Decluttering (clean up and clean out), Refurbishing (reface or resurface) or Repurposing (change a rooms use).
  • Is the issue a deficiency or just a just a nice improvement? 
  • Do all the neighbors have 2 bathrooms whereas this house only has one? 
  • Will it add a distinctive feature to the house that will enhance the marketability like a walk-in closet, whirlpool bath or a fireplace?
  • Is the remodel project overkill when looking at the rest of the house and the market?
  • Is the project the simplest most cost-effective solution to satisfy the need?
  • Does the end result fit with today’s homeowners’ expectations?


Obviously questions like these address the reason and need for a remodel but what about the hard ROI side of the equation?  Once again you don’t want to step into the contractor’s shoes, but a little knowledge to put things in perspective should be part of your knowledge base.  Here are some relative ROI values from a past survey by Remodeling magazine:


Kitchens – often become dated sooner than any other room due to wear and tear – 92.9%.


Bathrooms – they have changed the most over the years – 90.1%; adding a bathroom yields 86.4%.


Family rooms – adding one will return approximately 80.6%.


Bedrooms – adding an additional bedroom results in an 82.75% return; a master suite approximately 80.1%.


Decks – average ROI here is 86.7%.


Windows – add “volume” to a home and yield a surprising 84.5%.


Of course the very next question you are going to get is “How much will it cost?”  While you should first qualify your response with the statement that you are not a contractor, you can provide your sellers with some price ranges for different remodeling projects.  A great resource for these types of statistics is the Hanley Wood Remodeling site:


There you’ll find a complete set of costs and projected returns for a wide range of remodeling projects and – best of all – the statistics have been adjusted 9 regions of the country.  The data is based on 2006 information, but is certainly current enough to provide your clients with a range to consider.  Here’s an example from their database for a minor and major kitchen remodel comparing the National Average to the South Atlantic Region:


National Average:



Job Cost

Resale Value

% Cost Recouped

Major Kitchen Remodel




Minor Kitchen Remodel





South Atlantic Region:


Major Kitchen Remodel                                     




Minor Kitchen Remodel





Remodeling is a major financial commitment for a homeowner, not to mention the disruption of daily life and the length of time needed to complete a project.  It’s good forethought for any agent to have some basic understanding of the issues.  When you sit down to discuss home staging needs with your client the subject of remodeling will often come up:  Should we stage or remodel?  What should we remodel?  How much will it cost?  Will we get our money back?  Will it make our house sell faster?


Being prepared to intelligently discuss remodeling in conjunction with your home staging recommendations is a definite plus.  Being able to better prepare your clients to discuss a proposed remodel with their contractor in light of current market conditions will set you above your competition. 


If you feel you’re not adequately prepared to make specific home staging recommendations to help your client turn their “lived-in home” into a “home for sale”, then you need to consider taking the Accredited Home-Staging Specialist (AHS) course from RealtyU.  This online course provides an excellent overview of the home staging process and includes great tips, tools and checklists to assist you in the process.  You can learn more about the AHS course by visiting


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